Canadian Spectum Auction Passes $2 Billion Mark

Published on: 2nd Jun 2008

Note -- this news article is more than a year old.

Canada's wireless spectrum auction finished last night having passed the CA$2 billion (USD2.01 billion) landmark after two weeks of bidding and exceeding the estimated CA$1.5 billion which had been thought to be earnt. The auction is expected to continue for another couple of weeks.

Under the terms of the spectrum auction - 40% of the available radio capacity
has been reserved for new entrants, and it is widely expected that a new
national operator could emerge from the process.

Shaw Communications, which has declined to explain its plans for any radio
spectrum it may win lead the auction as of last night - with the highest bid on
36 of the 292 regional licenses available. Most of Shaws bids have concentrated
in Western Canada.

Quebecor is second with 23 top bids and has previously said that it is
looking at building a nationwide network. MTS Allstream is third and Telus is
fourth - although it is the top bidder amongst the current incumbents.

Toronto has proven to be the hot-spot for bidding with several companies
competing furiously for licenses. Interestingly, the top bidder is Bragg
Communications - which is not actually thought to want a license in the city,
but is thought by some analysts to be driving up the price so as to soak up
funds from the winner who would then have less flexibility to bid for regional
licenses. It is these which Bragg is thought to be most interested in acquiring.

In related news, Liberal MP David McGuinty has proposed a new law which would
ban network operators from levying any additional fees and charges that aren't
part of a customer's monthly plan rate. The proposed law would also require
contracts to detail the costs associated with roaming onto regional networks.

"I hope this goes some distance in addressing what many Canadians
believe to be unfairness and a lack of transparency in the charging for services
that are occurring on a monthly basis," McGuinty, MP for Ottawa South, told
the House of Commons.

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